Rebalancing the wheels: The automotive sector faces a defining gear shift as insolvencies rise

Amy Keogh of Browne Jacobson discusses mounting insolvency pressures in the automotive sector, driven by declining global vehicle sales, growing competition from Chinese manufacturers, the costly transition to electric vehicles and geopolitical trade tensions, with traditional component suppliers facing shrinking order books, covenant breaches and tightening refinancing conditions, while considering the increasing use of pre-pack administrations, accelerated M&A processes and cross-border restructurings to preserve going-concern value before liquidity pressures become terminal.

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